Intel reported better-than-expected fourth-quarter results, but missed revenue forecasts due to slow demand for data center chips. The company’s shares rose 3.8% in after-hours trading.
Intel’s quarterly report revealed a 7% year-over-year decline in revenue to $14.26 billion, beating estimates of $13.81 billion. However, the forecast for current-quarter revenue was lower than expected, at $11.7-12.7 billion, compared to analysts’ average estimate of $12.87 billion.
The company attributed the miss to “normal seasonality” and potential tariffs from President Trump’s administration. Investors are waiting for a new CEO to take over, following Pat Gelsinger’s ousting last month. Interim co-CEOs Michelle Johnston Holthaus and David Zinsner emphasized the need for leadership stability to navigate the competitive landscape.
Intel plans to focus on future data center AI products and has shelved its forthcoming graphics processing unit (GPU) design called Falcon Shores. The company expects operating expenses of $17.5 billion by 2025. Investors are concerned about pressure on cash flows due to heavy spending on contract chip manufacturing.
The PC market, Intel’s largest revenue source, saw global shipments rise only modestly last year, underperforming analysts’ expectations. The company is also losing share in the PC and server CPU market to rival AMD. A new CEO is expected to bring clarity to the business’s future strategy, but investors are looking for reassurance on leadership stability.
Despite the mixed results, Intel’s shares rose following the release of the quarterly report, indicating that investors remain optimistic about the company’s prospects.
Source: https://finance.yahoo.com/news/intel-forecasts-first-quarter-revenue-210400965.html